Tax Update Blog: Permalink

Theory, Meet Practice

November 20, 2009

George Yin, former Chief of Staff of the Congressional Joint Committee on Taxation, thinks temporary legislation -- such as the perpetually-expiring AMT patch and research credit -- is a good thing:

Consequently, enactment of temporary-effect rather than permanent legislation would promote more political accountability and may result in greater fiscal restraint. In addition, when temporary-effect legislation expires, the legislative process fully takes into account the cost of any extension. Extension of such legislation, therefore, competes with, and potentially displaces, adoption of other legislation. By contrast, the cost of continuing permanent programs largely disappears in the legislative process, and therefore continuation of such programs produces little or no crowding-out effect.

Here's how that's working out in the field, as reported by Tax Analysts ($link):

The House Ways and Means Committee will likely approve renewals of the full set of so-called tax extenders, panel Chair Charles B. Rangel, D-N.Y., told reporters November 19.

Rangel said he was embarrassed not to let at least some of the incentives expire as scheduled but said the committee lacks the time this year to hold hearings on the matter.

"It would really cause more of a problem in excising them with this short period of time we have," Rangel said. "We can't just say we don't like [extenders]. We have to ask you to justify why it's in the code."

So much for accountability and fiscal restraint. Charlie Rangel is just too darn busy.